Strategic Analysis Framework in Action

Strategists should be interested in the current and future impacts of incidents, not incidents theirselves. The end-to-end process consisting of gathering, processing, synthesizing data and information and developing strategy steps should be based on an effort of understanding current and possible future impacts. I generally use a practical Strategic Analysis tool which was developed by me on Kumu platform in order to analyze impacts. This tool does not only provide a new perspective to top managers based on relational analysis, but also functions as a presentation layer or visual articulation which lets management team create a common language and discuss.

​Click to access a sample diagram related to the framework on Kumu

The landscape consists of several domains which reveal the different dimensions of external environment. To understand the framework and general structure please visit: A New/Practical Strategic Analysis Framework.

FACTOR		Factors are the components which affect the organization. They are used to describe the current states and possible future states as assumptions.
GEOGRAPHY / ACTOR		​Black octagon-shaped components describe analysis contexts as actors or geographies.
CURRENT STATE		Current states are the incidents which started in the past and are continuing or have just started. They are currently affecting the organization.
FUTURE STATE		Future states are the assumptions about incidents which are expected to happen in the future and will possibly affect the organization.
RELATIONSHIP		​Relationships show how and in which direction one component affects the others and the extents of the effects.

PROCESS

A systematic process related to the Strategic Analysis framework is sugested below:

Step 1. Factor Analysis

Firstly the context (geographies and actors) and factors which likely affect the organization should be defined under each domain and then prioritized based on their levels of impact on the organization (on a scale of 0-7). This is the main base on which the analysis will be built.

Step 2. Current State Analysis

The key point is to understand what happens currently under each domain and how this picture will evolve in the future. Based on each factor, the current state should be described in dept by asking the following questions:

• What situations have we been facing which are likely to affect our organization? What types of situations: Trend, risk, challenge, blockage, opportunity?

• What are the root causes of these situations (by 5-Why questioning) and what countermeasures have being taken by who (such as governments, authorities, companies, NGOs) to eliminate them?

• What are the implementation plans for these countermeasures? Resources, budget, timetable etc.

• What is the completion rate of the countermeasure? What is the percentage of progress (on a scale of %0-100)?

• What is the success of countermeasures to eliminate the root causes? Are the countermeasures successful attempts to eliminate the root causes?

Willingness and taking effort about countermeasures signal us what the current state will evolve into in the future. Thanks to them, we can predict the likelihood, direction and impact severity of an incident, phenomena or condition change.

Step 3. Future State Analysis (Assumptions)

One of the best ways to predict the future is to make assumptions about it. Assumptions are key components of strategic scenarios.

Some assumptions are about the future of the current state. Second types of assumptions are based on the incidents expected to be triggered by the current state. Other ones are independent assumptions which are not the future of the current state or not triggered by the current state).

Future assumptions should be defined based on the factors by asking the following questions:

• What leading indicators should we monitor to predict what the current state will evolve into in the future? (The answer gives an idea about the evolution of the current state)

• What assumptions can we make about the future of the current state? When will the possible future states which are the subjects of assumptions start, and how long will they last? What are the likelihoods of the assumptions realizing (on a scale of %0-100)?

• What other assumptions under the same domain or another domains might the current situation trigger?

• What are independent assumptions under domains?

• In what ways and how can the assumptions be validated (unless the assumptions are not validated, they should not be incorporated in Strategy Development process)?

Step 4. Impact Analysis

The main goal of a strategist is to understand how the changes in the external environment affect the organization now and how they might affect it in the future. At this point, a new parameter comes into play: Impact.

Impacts are analyzed on a scale of -7 / +7. Impacts scored between -1 and -7 are negative impacts, and impacts scored between +1 and +7 are positive ones. 0 (zero) indicates that there is no impact (neutral). The intensity of impacts is depicted with arrows of different thickness.

Impact Analysis gives strong opinions about what impacts should be considered by top management.

​Click to access a business case for Strategic Analysis Framework